1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89
90
91
92
93
94
95
96
97
98
99
100
101
102
103
104
105
106
107
108
109
110
111
112
113
114
115
116
117
118
119
120
121
122
123
124
125
126
127
128
129
130
131
132
133
134
135
136
137
138
139
140
141
142
143
144
145
146
147
148
149
150
151
152
153
154
155
156
157
158
159
160 
"Corus are still a good company and we enjoy the
Page 41
If you've noticed an error in this article please click here to report it so we can fix it.
relationship... it was in our top three customers. Now it is 16th."
Eddie Anderson, ARR Craib The UK's largest steel group, Corus, announced last month it is cutting 1150 jobs across its operation in the next two years, with 2,200 more under threat. The axe falls as follows: by the end of next year, 350 jobs will go at Stocksbridge near Sheffield, another 350 from Rotherham, 100 at Llanwern, 90 at Tipton and another 200 or so across the UK from various sites. In addition, Carus' Teesside plant, at Redcar, has been put on probation with the stark instruction to find new markets or close.
For hauliers in the steel industry, It was a grim announcement but not an unexpected one: since the end of the 1960s, nine out of 10 UK steel jobs have gone. And more than 10,000 of them have disappeared since 1999.
Fifty or so transport firms have what Corus calls "lead contractor" status in its production and distribution businesses, with the company's sites negotiating individual rates with its transporters. No one at Faber Prest Steel Distribution, which may be among the hardest hit, was available for comment. Others too, such as Steve Richardson, director of RF Richardson Transport in Middlesbrough, are reticent. He told CIA "I don't want to comment much on it. It is not a positive thing but we've not really been affected as yet."
Impact
Corus plays down the impact of the job losses on transport operations. "There is some haulage of steel slabs from Rotherham to Scunthorpe for rolling and almost the same volume of finished product to customers at Stocksbridge," a Corus spokesman says. "Steel finishing will continue at Stocksbridge." Half its workforce will go and production will cease, however.
The road transport industry is right to be nervous. Aberdeenbased ARR Craib does all Scottish distribution for Corus' Corby plant, which has escaped most of the cuts in the past few years. Craib managing director Eddie Anderson says: "Corus are still a good company and we egjoy the relationship." But, although Anderson is far too diplomatic to say it, this is largely because the steelmaker's business is no longer so important to Craib as it once was. "It used to be a big chunk," he goes or. "Corus was in our top three customers. Now It is 16th." This means it brings in just over 1% of Craib's turnover.
Craib's growth in the last few years has come from other areas and that is the way Anderson likes it. Indeed, it is hard to be confident in Corus. Welsh hauliers in particular will remember that it stopped steelmaking at several sites in Wales in 2001 as part of what it called a "major restructure".
Yet, just two years on, thousands more workers find their jobs either gone or threatened. The manufacturer blames market conditions, saying that UK demand for steelmaking has decreased since then by 8%—hence the latest round of cuts. "We're making too much steel in the UK," says a Corus spokesman. Cheaper foreign steel, the strength of the pound and poor management have been variously cited as the main factors in Corus' decline. But none of this helps the hauliers who will lose work.
At least this time Wales looks likely to escape the worst of the fallout. Canine area manager Paul Robinson insists that little will change, while Mike Jeffreys, TGWU senior regional industrial organiser, recalls: "Last time, with Ltanwern and Ebbw Vale and so on, we were really pasted. But hauliers will clearly have grave concerns about anything that happens at Corus. Trucks carry two or three large steel coils so you don't have to cut [the production of] many coils before you start losing trucks."
And distribution operations will not be the only ones affected, adds Jeffreys: "Remember that many companies survive solely on shunting operations within plants. You're not just talking about 40 or 50 drivers out on the road, but another 30 to 40 people doing shunting."
Corus says it is investing in its sites at Port Talbot, where it plans to increase output of liquid steel, and at Scunthorpe where a new blast furnace is coming on stream. But at Teesside, workers have been told that Corus will no longer be taking its steel for use at the manufacturer's other divisions in the UK.
"There is a huge question mark hanging over the plant," admits the TGWU. Corus is more blunt. "Teesside will continue as long as it is contributing cash to the group," a spokesman says. As soon as it does not, then it will be sold—or shut down.
Whatever happens in the future, that is a major blow right now. Each year, 1.8m tonnes of steel slabs are transported from Teesside (which produces 3.5m tonnes of steel) to South Wales for finishing. Corus argues much of this is done by rail, but one thing is for sure: this transport business will simply cease as Corus looks abroad.
Corus insists that the drastic changes are required to push it into the black. And for anyone involved in hauling steel, or indeed providing services to any part of the UK's manufacturing businesses, the overall figures make unpleasant reading.
Manufacturing now comprises just a fifth of the UK economy. By contrast, the service sector makes up twothirds of UK plc, and has created two million jobs in the last decade. Against that background, nobody would bet against another major restructure of Corus being necessary sooner rather than later.
And whatever the short-term impact of the latest announcements from Corus the simple truth is that steel carriers are having to fight harder to carry less product. According to the latest Overview of the UK Road Freight industry to 2007 commissioned by Lloyds TSB Asset Finance, the weight of iron and steel lifted by road hauliers between 1998 and 2002 fell by 22%. Figures that make for stark reading, and figures that are unlikely to get any better after Corns completes its restructuring.
Standards
It is true that some jobs will be created in new projects at the South Wales works. 'You can't sniff at jobs," the TGWU's Jeffreys admits. But the union is concerned that many of the Carus workers who will have those posts may be transferring from better-paid work elsewhere in the group. "If they are doing that to their own employees, imagine what they are thinking about hauliers," he adds. In other words, those hauliers working for Corus who have not had a rate increase in three years should not hold their breath. "The driving down of standards is the problem," says Jeffreys. "It'll be another round of 'Who can do it cheapest, boys?'.
"People describe it as a cattle market, but that's not right. At least with a cattle market, the cows go to the highest bidder."